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Contrasting Relationships of Financial and Banking Oversight Agencies: Self-Funding Agencies Versus Appropriation-Dependent Agencies
Journal Issue
Volume 28, 2021Abstract
In the last several decades, Congress has forgone their duty to properly fund the government before the start of the fiscal year. This has led to multiple continuing resolutions or large end-of-the-year omnibus spending bills well after the new fiscal year has begun. Congressional failure to fund the government in a timely manner creates uncertainty for regulators and directly impacts their operations. This article analyzes the three distinct funding mechanisms of the Commodity Futures Trading Corporation, the Securities and Exchange Commission and the Federal Deposit Insurance Corporation, and how the appropriations process or self-funding model impacts their operations. For the handful of self-funding agencies who exist outside the congressional appropriations process, their operational activity continues to function without interruption. But for most financial service regulators that rely on direct appropriations, their oversight actions and responsibilities are placed on pause until Congress approves a budget and the President signs the legislation.